Atmel, Nvidia propel next-gen MIDs

SAN JOSE, Calif. – How can OEMs develop products that will successfully compete against Apple Inc.’s iPhone and iPad?

Two chip makers believe that they have the right formula. At the Mobile World Congress in Barcelona, Spain, Atmel Corp. and Nvidia Corp. will officially roll out a reference design kit that will enable next-generation mobile Internet products based on the Android operating system.

This reference design includes Nvidia’s Tegra 2 ARM-based processor and Atmel’s mXT1386 touchscreen chipset. The kit enables OEMs to speed up their development of Android-based smartphones, tablet PCs, mobile Internet devices and other products, said Binay Bajaj, senior product marketing manager of touch products at San Jose-based Atmel.

The Tegra 2 is a dual-core, ARM-based processor that runs at 1-GHz. Atmel’s maXTouch touchscreen chipset family enables up to 16-simultaneous touches.

Not all OEMs will succeed in the next-generation smartphone and tablet PC markets, Bajaj said. But with this reference kit, OEMs will stand a fighting chance to gain ''a lot of traction,’’ Bajaj told EE Times.

Other chip makers are also vying in this space. In the mobile Internet processor front, Broadcom, Freescale, Intel, Nvidia, Marvell, Qualcomm, TI and others compete in the arena.

This market includes smartphones and tablet PCs, which is dominated by ARM-based processors. Intel Corp. is looking to crack the fray with x86-based solutions.

In the touchscreen chipset market, Atmel, Cypress, IDT, Renesas, Synaptics and others compete. Atmel Corp. appears to have the most momentum in the arena, which is expected to become even more competitive. ''Starting in 2012, we believe the landscape is set to become hyper competitive from new touch vendors, including Maxim, Avago, TI, Silicon Labs and ADI,’’ said analyst Doug Freedman of Gleacher & Co.

It is critical for OEMs to select the right chip solutions and for good reason in the arena: The stakes are huge. ''We believe the semiconductor industry is entering the fourth wave of computing or the ultramobile era,’’ said Gus Richard, an analyst with Piper Jaffray & Co., in a recent report. ''The iPad, iPhone, and Android operating system are all early winners in this new era, and they are leading the fourth wave.’’

The smartphone market is projected to grow 30 percent in 2011 and jump another 25 percent in 2012, according to Gleacher & Co. Apple, HTC, LG, Motorola, Nokia, RIM, Samsung and others are fighting each other in this space.

Global shipments of tablets-a segment consisting of media tablets like Apple’s iPad as well as PC-type tablets-are set to rise to 242.3 million units in 2015, up by a factor of more than 12 from 2010, according to IHS iSuppli.

“The remarkable expansion of the tablet market from 2010 to 2015 will be driven by three successive waves of growth,” said Rhoda Alexander, director of monitor research at HIS, in a recent report.

“The first wave, which (hit) in 2010 and 2011, was created by the arrival of the iPad and the ensuing tsunami of demand for the device. The second wave, arriving in 2011 and 2012, will be propelled by a deluge of iPad competitors, particularly Android-based models,’’ she said. ''The third wave, which will turn up in 2013, will consist of a flood of models based on the Windows operating system that will expand the reach of tablets into traditional computer markets.”

While the iPad will lead annual tablet shipments through 2012, the increasing strength of media-tablet rivals combined with the advent of PC-type platforms will cause Apple to lose its majority of total unit shipments starting in 2013, according to the research firm.

‘‘Tablets are the latest craze with more than 150 different tablets in development around the world. Only a handful of these devices will be successful en masse, meaning the other 140+ devices will be 'me-too' flops,’’ said Craig Berger, an analyst with FBR, in a recent report.

Today, Apple dominates the tablet market with some 80 percent share. Apple is designing its own processors and touchscreen devices for its iPhone 3 and iPad. However, Apple’s iPhone 4 makes use of Qualcomm Inc.’s MDM6600 baseband/RF transceiver.

That Atmel Nividia combination sounds good for OEM's. Speeding up development is a good offer. However, I bet that development, whenever is speeded up, something gets sacrificed and I bet that's customization or versatility. Using of the shelf building blocks takes away de creative and fun part from development and all those quickly done OEM's will not be so 'O' (for Original) after all. Only the outside look will be the differentiator. Of course, there will be a market for that also, but as Mr. Benson said, I too doubt they'll convert the Applebees.

I'd say that other companies shouldn't necessarily think about competing with Apple so much as learning from Apple and competing with everyone else. While it is possible to win some customers from Apple, in general, Apple folks tend to be Apple folks and non-Apple folks tend to be non-Apple folks. They have 80% market share, not because they have a product for a 80% of all potential tablet users, but because the other manufacturers that will sell to the other part of the market are still not quite there yet.
The commoditization of the innards make differentiation much more difficult, but still possible. Essentially, depending on how heavily the manufacturer leverages the reference design, the basics will be very similar between virtually all of the tablet vendors.
With such little room for capability-based differentiation, brand loyalty, price and the little things are where market share will be gained or lost. Those three aspects are what will create a strong competitor.

A very good summary of the Tablet and smart phone market of the future. The touch screen controllers market is booming because of the all the smart phones and tablets are coming out with touch screens. The processor market is also getting interested because of the NVIDIA entered into the market at the tight time with their Tegra2 processors.